During a recent appearance as a guest on the TV show Charlie Rose, Disney’s CEO Bob Iger admitted that the DVD market is no longer the dominant medium to view video. When Charlie Rose asked if DVDs were dead, Iger responded that the DVD market is “not as healthy as it was,” but it is certainly not dead.
In the interview, Iger implies that there are two major trends related to DVD and video consumption: the diversification of platforms to consume video and the increase of competition for people’s time.
On the show, Iger speaks of the evolution of entertainment viewing with the innovation of the home video market first with VHS, then with DVD. This innovation was the first phase that allowed viewer greater choice to watch video when they want it.
With the proliferation of websites where video viewing is possible such as YouTube, Hulu, and Facebook, Disney has seen the DVD market decline in sales of an estimated 15% year over year. It is unclear if this figure includes Blu-ray sales or not. These new options continually increase the flexibility and immediacy of the video viewing experience.
However, increased diversification of the video consumption market does not tell the whole story. While the sale of video through iTunes and other platforms is growing substantially, it does not fully offset the loss of revenue from decreased disc sales. In other words, the amount of revenue a movie makes as a whole is decreasing, even though these videos are expanding to ever larger markets.
Iger indicates that with the growth of great, easily available content and platforms to consume it (i.e. iPad, Facebook), there is a significant increase of competition for people’s time. We have more quality products to watch, listen to, or read than ever before.
Iger says “what we must do is make the product available to them (consumers) under flexible or expanded circumstances.” He suggests that if a product is not available when and how someone wants to watch it, they will easily find something else to do instead.